Despite losing millions in government funding, not to mention its marquee property NHL hockey, CBC head Hubert Lacroix says there is no future for the public broadcaster in becoming a “niche broadcaster,” restricting itself to doing only what Canada’s private broadcasters can’t – or won’t – do because there is no business incentive.
In a speech before the Senate Transport and Communications Committee last week, Lacroix echoed a sentiment he expressed in an internal memo to CBC staff: There are “dark clouds on the horizon” for the public broadcaster.
Lacroix said that a $45 million reduction in government funding – along with a $14 million cut from an additional freeze on inflation funding for salaries, and $27 million less for local programming because of the elimination of the CRTC’s Local Programming Improvement Fund – for 2014-15 will be exacerbated by the CBC’s recent loss of NHL broadcast rights to Rogers Communications.
He predicted that the loss of NHL rights would create a “ripple effect” that will compromise the public broadcaster’s ability to package and sell advertising on its other programs.
In a presentation to the Senate committee earlier this month, industry watchdog Friends of Canadian Broadcasting said that the loss of NHL hockey would see CBC Television’s ad revenues fall by more than $120 million, half of its total annual ad revenue.
Friends predicted that the net benefit of its remaining advertising would decline to a level where the public broadcaster could contemplate going non-commercial for the first time.
Lacroix told the committee that he has warned staff the CBC will face some “tough decisions” this year and in its next five-year strategic plan. These decisions won’t just encompass balancing the budget, he said, but will address more fundamental decisions about what the CBC is and what it does.
“We need to develop a long-term sustainable financial model for public broadcasting in Canada,” he said. “And we need government, the CRTC and the stakeholders who have an interest in public broadcasting, to realize that we need more flexibility in order to shine.”
Lacroix said that only CRTC regulation and public investment are able to ensure the promotion of Canadian content, and with the Internet making regulation increasingly difficult, most western countries are focusing on the latter. He noted that among 18 western countries, only public broadcasters in New Zealand and the United States currently receive less government funding than the CBC.
For now, said Lacroix, the CBC continues to provide exceptional Canadian content with a budget significantly less than its counterparts in other countries. He pointed to the recent Sochi Olympics as an example of how CBC delivered more content than broadcasters such as NBC and the BBC, with considerably less resources.
The $1 billion in government funding the CBC receives is divided among its 33 services in English and French (as well as eight Aboriginal languages) spanning radio, television and online, all across six time zones. By comparison, its U.K. counterpart the BBC receives close to $6 billion in funds and works in one official language and time zone.
He said that the CBC supports both an independent production industry as well as local businesses and communities. He cited a 2011 study by Deloitte, which found that every dollar invested in CBC/Radio-Canada creates almost four dollars in economic value.
Lacroix told the committee that the CBC has gone some way towards achieving the objectives set out in its most recent strategic plan, 2015: Everyone, Every way – to be more Canadian, more anchored in Canada’s regions, and more digital.
Lacroix said that Canadian programming now comprises 86% of CBC Television’s primetime schedule and 91% of Radio-Canada’s, both well above the minimum license requirements. “Private broadcasters can’t do it; they can’t afford to do it,” said Lacroix. “Their business models don’t allow them to do that.”
He said that CBC/Radio-Canada’s combined investment for Canadian programming was $732 million in the 2013 broadcast year, while all of the private broadcasters combined spent $614 million.
Lacroix also noted that the CBC has expanded its local news programs and created regional radio services in communities including Kitchener-Waterloo, Saskatoon, Kamloops and Rimouski, with additional investments planned in 2015.
On the digital front, the CBC has created new music services including CBCMusic.a and espace.mu, as well as a safe online space for children with KidsCBC.ca. Radio-Canada has launched a new web series called Le chum de ma mere est un extra-terrestre, intended to help children 9-12 develop their online skills, while a new educational portal, Curiou.ca, puts the CBC archives in the hands of teachers and students.